News / Economy

EU, China Stumble Toward Solar Trade War

FILE - Employees examine newly-made solar panels before boxing for shipment at a factory of Yingli Solar in Baoding, Hebei province, August 2, 2012.
FILE - Employees examine newly-made solar panels before boxing for shipment at a factory of Yingli Solar in Baoding, Hebei province, August 2, 2012.
Reuters
China's leadership transition is complicating talks to resolve a multi-billion-dollar dispute with the European Union over solar panels, pushing both sides closer to placing punitive tariffs on each others' exports and risking a trade war.

The newly-appointed chief of China's Communist Party Xi Jinping is set to take over the presidency at a national congress in March. But the full line-up of government officials is not yet in place and China's current commerce minister is likely to step down after what some have said was a political snub at the party's congress in November.

EU leaders want to avoid following the United States' decision last year to impose duties on Chinese solar power products, aware that Europe needs China to help it emerge from three years of economic crisis.

But EU officials and diplomats say they have made little progress, accusing the Chinese of "stonewalling," and are unable to get beyond the outgoing commerce minister, Chen Deming. They complain of a limbo in the ministry that will not end until after the March congress.

"There is no clarity on what the new leadership thinks about trade," said a senior EU official involved in talks with China. "They are stonewalling and the window of opportunity for a solution on solar panels is closing."

China's commerce ministry spokesman Shen Danyang told reporters in Beijing this week that officials are "conducting consultations and relevant response work with the concerned parties," but did not comment on any impact China's leadership transition is having on negotiations.

Germany, the United States and China are the world's biggest solar markets and companies are in a race to win contracts as countries seek to limit pollution and global warming.

In a non-binding vote, EU countries approved on Wednesday a request from industry to register solar panels from China, which would allow for retroactive measures if the European Commission agrees to registration and does impose duties.

But the Commission, the EU executive, denied on Thursday that the decision by member states signalled Brussels was closer to blocking Chinese solar products. "Let's not interpret this as suggesting anything - it is simply administrative procedure," EU trade spokesman John Clancy said in a statement.

Race Against Time

European solar panel manufacturers, led by Germany's Solar World, accuse their Chinese counterparts of receiving state subsidies to flood the EU with panels sold below cost and putting Europeans out of business to corner the market.

The Commission launched an investigation last September into Chinese solar panels, the biggest import sector it has ever targeted. China exported more than $25 billion worth of panels to the European Union in 2011.

Highlighting the risk of a trade war, Chinese solar companies also accuse the European Union of wrongdoing.

China says Europe illegally favors it domestic solar panel producers and Beijing is considering its own duties on EU exports of polysilicon, which is used to make solar panels.

FILE - Employees carry solar panels at a solar power plant in Aksu, Xinjiang Uyghur Autonomous Region, May 18, 2012.FILE - Employees carry solar panels at a solar power plant in Aksu, Xinjiang Uyghur Autonomous Region, May 18, 2012.
x
FILE - Employees carry solar panels at a solar power plant in Aksu, Xinjiang Uyghur Autonomous Region, May 18, 2012.
FILE - Employees carry solar panels at a solar power plant in Aksu, Xinjiang Uyghur Autonomous Region, May 18, 2012.
Complicating things further, some European distributors and installers of Chinese panels say EU tariffs on China would be damaging for Europe's efforts to develop clean energy. They say solar energy is only efficient using Chinese products that are up to 45 percent cheaper than those made in Europe.

"Even without the [leadership] transition, this is a very difficult issue,'' said Scott Kennedy, director of the Research Center for Chinese Politics and Business at Indiana University. "I really don't see a negotiated outcome."

Time is of the essence because many expect Beijing to make a decision on polysilicon duties as soon as the end of February.

The EU's investigation must culminate in a decision by June.

In reality, that is likely to come by mid-April, when diplomats from the EU's 27 countries make their recommendation to the European Commission, which is handling the case.

Such a timeframe does not give a new trade minister in Beijing much time to get acquainted with the issues and reach a settlement. EU Trade Commissioner Karel De Gucht said there is no chance of tweaking the investigation's deadline.

"They know exactly what it is about, the solar panel case. We are consulting them, it is up to them," De Gucht told Reuters. "You cannot have something like a prolongation of that period because there is a transition in China."

In the past four years, the Commission has only chosen to end one trade defense case in China without imposing duties.

You May Like

China May Be Biggest Winner From Ukraine Crisis

Missile sales, oil and gas shipments are among many areas that may drive Beijing and Moscow closer together in coming years More

Obama Faces Chaotic World, Limits of Power

Current foreign policy issues bring into focus challenges for US policymakers who are mindful of Americans' waning appetite for overseas military engagements More

SADC Meeting Lesotho Officials to Resolve Stalemate

Official says regional bloc has been engaged with leaders in Lesotho to resolve political disagreement that led to coup attempt More

This forum has been closed.
Comment Sorting
Comments
     
by: Ian from: USA
February 22, 2013 5:48 PM
"Complicating things further, some European distributors and installers of Chinese panels say EU tariffs on China would be damaging for Europe's efforts to develop clean energy. They say solar energy is only efficient using Chinese products that are up to 45 percent cheaper than those made in Europe."
it is the same excuse Walmart used . You save 45% but the hidden cost of european workers losing jobs may be higher than 45% !


by: JKF from: Ottawa, Canada
February 21, 2013 11:20 PM
Tarrifs/duties are the only way to deal with producers, that do not work from a level playing field; and more importantly to protect home producers from an unfair business practice(s). But the money collected must go to the producers, as compensation...will it?

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
West Africa Ebola Vaccine Trials Possible by Early 2015i
X
Carol Pearson
August 30, 2014 7:14 PM
A U.S. health agency is speeding up clinical trials of a possible vaccine against the deadly Ebola virus that so far has killed more than 1,500 people in West Africa. If successful, the next step would be a larger trial in countries where the outbreak is occurring. VOA's Carol Pearson has more.
Video

Video West Africa Ebola Vaccine Trials Possible by Early 2015

A U.S. health agency is speeding up clinical trials of a possible vaccine against the deadly Ebola virus that so far has killed more than 1,500 people in West Africa. If successful, the next step would be a larger trial in countries where the outbreak is occurring. VOA's Carol Pearson has more.
Video

Video Survivors Commemorate 70th Anniversary of Nazi Liquidation of Jewish Ghetto

When the German Nazi army occupied the Polish city of Lodz in 1939, it marked the beginning of a long nightmare for the Jewish community that once made up one third of the population. Roughly 200,000 people were forced into the Lodz Ghetto. Less than 7,000 survived. As VOA’s Kane Farabaugh reports, some survivors gathered at the Union League Club in Chicago on the 70th anniversary of the liquidation of the Lodz Ghetto to remember those who suffered at the hands of the Nazi regime.
Video

Video Cost to Raise Child in US Continues to Rise

The cost of raising a child in the United States continues to rise. In its latest annual report, the U.S. Department of Agriculture says middle income families with a child born in 2013 can expect to spend more than $240,000 before that child turns 18. And sending that child to college more than doubles that amount. VOA’s Deborah Block visited with a couple with one child in Alexandria, Virginia, to learn if the report reflects their lifestyle.
Video

Video Chaotic Afghan Vote Recount Threatens Nation’s Future

Afghanistan’s troubled presidential election continues to be rocked by turmoil as an audit of the ballots drags on. The U.N. says the recount will not be completed before September 10. Observers say repeated disputes and delays are threatening the orderly transfer of power and could have dangerous consequences. VOA correspondent Meredith Buel reports.
Video

Video Ukraine Battles Pro-Russia Rebel Assault

After NATO concluded an emergency meeting to discuss the crisis in eastern Ukraine, the country is struggling to contain heavy fighting near the strategic port of Mariupol, on the Azov Sea. Separatist rebels are trying to capture the city, allegedly with Russian military help, and Ukraine's defense forces are digging in. VOA's Daniel Schearf spoke with analysts about what lies ahead for Ukraine.
Video

Video Growing Business Offers Paint with a Twist of Wine

Two New Orleans area women started a small business seven years ago with one thing in mind: to help their neighbors relieve the stress of coping with a hurricane's aftermath. Today their business, which pairs painting and a little bit of wine, has become one of the fastest growing franchises across the U.S. VOA’s June Soh met the entrepreneurs at their newest franchise location in the Washington suburbs.
Video

Video Ebola Vaccine Trials To Begin Next Week

The National Institutes of Health says it is launching early stage trials of a vaccine to prevent the Ebola virus, which has infected or killed thousands of people across West Africa. The World Health Organization says Ebola could infect more than 20,000 people across the region by the time the outbreak is over. The epidemic has health experts and governments scrambling to prevent more people from becoming infected. Zlatica Hoke has more.
Video

Video Asian Bacteria Threatens Florida Orange Trees

Florida's citrus fruit industry is facing a serious threat from a bacteria carried by the Asian insect called psyllid. The widespread infestation again highlights the danger of transferring non-native species to American soil. VOA’s George Putic reports.
Video

Video Aging Will Reduce Economic Growth Worldwide in Coming Decades

The world is getting older, fast. And as more people retire each year, fewer working-age people will be there to replace them. Bond rating agency Moody’s says that will lead to a decline in household savings; reducing global investments - which in turn, will lead to slower economic growth around the world. But experts say it’s not too late to mitigate the economic impact of the world’s aging populations. Mil Arcega has more.
Video

Video Is West Doing Enough to Tackle Islamic State?

U.S. President Barack Obama has ruled out sending ground troops to Iraq to fight militants of the so-called Islamic State, or ISIS, despite officials in Washington describing the extremist group as the biggest threat the United States has faced in years. Henry Ridgwell reports from London on the growing uncertainty over whether the West’s response to ISIS will be enough to defeat the terrorist threat.
Video

Video Coalition to Fight Islamic State Could Reward Assad

The United States along with European and Mideast allies are considering a broader assault against Islamic State fighters who have spread from Syria into Iraq and risk further destabilizing an already troubled region. But as VOA State Department Correspondent Scott Stearns reports, confronting those militants could end up helping the embattled Syrian President Bashar al-Assad.
Video

Video Made in America Socks Get Toehold in Online Fashion Market

Three young entrepreneurs are hoping to revolutionize the high-end sock industry by introducing all-American creations of their own. And they’re doing most of it the old-fashioned way. VOA’s Julie Taboh recently caught up with them to learn what goes into making their one-of-a-kind socks.
Video

Video Americans, Ex-Pats Send Relief Supplies to West Africa

Health organizations from around the world are sending supplies and specialists to the West African countries that are dealing with the worst Ebola outbreak in history. On a smaller scale, ordinary Americans and African expatriates living in the United States are doing the same. VOA's Carol Pearson reports.

AppleAndroid

World Currencies

EUR
USD
0.7537
JPY
USD
103.79
GBP
USD
0.6032
CAD
USD
1.0957
INR
USD
60.522

Rates may not be current.